What is your Plan B?

what is your plan bA series of storms through the Pacific Northwest has created havoc in the Portland metro area. Week after week one weather event or another shut the city down for a day or two each time, and in one case, nearly a week. Without getting into the dialogue about why this happened, the reality is, it did happen. And because of it, many people who are paid hourly lost out on wages, businesses are teetering on the edge given the low level of business over the course of weeks and schools are now facing adding days to the end of the school year. This was not expected by any of the parties.

The situation brings to light the necessity for a plan B. If things don’t go the way you think they will, how can you adjust? Every business will experience a significant disruption at some point in time. The question is, are you prepared to address it when it happens?   Have you thought about what may cause the disruptions and how you will handle each case if it happens? Businesses that are agile and move quickly to adjust to upturns as well as downturns outperform their peers. How are you getting ready to adjust to the inevitable turns in the market?

Are you getting the behavior you desire or the behavior you reward?

Are you getting the behavior you wantIt was the most recent round of attempts to confirm appointments. Dentists, doctors, hair salons, restaurants, etc. The forms of contact vary. Postcards, emails, texts, phone calls. They keep coming until you actively confirm your appointment. And if you don’t, your appointment will be canceled. I’ve been told the level of not showing up for appointments/reservations has reached new heights. Businesses now invest money in technology to get you to confirm your appointment, or in people making calls and following up to make sure you are coming. You now need to spend your time to confirm an appointment (rather than calling if you need to cancel). Your time and that of the company you intend to do business with is now consumed because the people who don’t show up aren’t penalized. The business loses revenue due to a person not showing up, and higher administrative costs focused on trying to get people to confirm appointments. And the behaviors of the offenders don’t change because there is no penalty for behaving badly.

There is a local restaurant that has two seatings for dinner. It is small, so important that seats are not open because the hit to revenue would be significant. They implemented a policy that requires a credit card to be provided when you make the reservation. It holds your spot. And if you don’t show up, the charge is nearly $100. Guess what. They don’t have a problem with people showing up for their reservations.

In business and in life, you teach people how to treat you. If you desire certain behaviors and you get them, reward it. If you don’t get the behaviors you desire, design a mechanism that corrects the behaviors you do not want in a targeted fashion such that only those who are offenders are addressed. When you get it right, you’ll start seeing the behaviors you desire. How are you getting the behaviors you desire in your business?

You Only Accomplish What You Make a Priority

you accomplish what you make a priorityIt’s that time of year again. January 1 is here and the New Year has started. Along with that comes the slew of New Years resolutions. It is visually apparent at the gym. Those of us who go regularly watch it happen every year. The place fills to the brim with people who want to get healthy, get in shape, etc. It will be packed for about a month and then go back to normal. Why? Because the resolution was a checklist item, not a priority. So, when things start getting busy, going to the gym falls down the list then ultimately drops off. For those who make it a priority, New Years is not an event. It is just another day to make it to the gym because going is a priority.

The same is true in business. What is made a priority happens, what is not doesn’t. The concept is very simple, but is one of the hardest to acknowledge. The reason the things you want done in your business don’t get done is that they are not a priority. Once you make it so, focus on it, ask about it, report on it, etc., it will start getting done. How are you focusing on your priorities and getting the outcomes you want?

Just because you can’t see it, doesn’t mean it isn’t there

just because you can't see it, doesn't mean it isn't thereIt was the wee hours of the morning and a heavy storm rolled in. Wind pounded the side of the house and the rain was coming down. And then I heard it. Tink. Tink. Tink. The sound of water dripping in the bathroom. Water was clearly coming in through a vent from the roof and flowing through the fan in the ceiling. A few days later the roof repair folks came out to confirm my suspicion.

While he was investigating, I put my dog in the garage. After he left, I opened the garage door to let her into the house. She was running full speed until she hit the threshold and froze in her tracks. She started sniffing the air, then went to the front door and picked up the scent. She tracked it all the way up the stairs, into the bathroom and then to the laundry room (attic access). From time to time she paused. It was the exact path the man took. I certainly couldn’t see or smell where the man had walked, but she could even though she had no specific training in tracking scents.

Just like the trail of scent exists even though I couldn’t see it, things go on in business every day that are not necessarily visible. That doesn’t mean it isn’t there, it just means you may not see it. Maybe it is a person that works in the background and makes sure that things happen. Or the person that keeps their finger on the pulse of customer needs and finds a way to keep them pleased. Things just seem to work because there are people in the background making it happen. You don’t necessarily see it happen without looking for it. How do you keep your eyes open for things in your business that you may not see?

How Many People Walk By?

Easy vs Hard - do people walk by?Last week I wrote about a water leak at a house I walk by on a daily basis. After two weeks, two calls to the water department, three attempts at knocking on their front door, and knocking on three neighbors doors, the water is still flowing heavily down the hill and down the drain. This house is on a fairly busy corner. Many people walk by at all times of the day. So it raises several questions: do people walk by and not do anything? Do they walk by and not notice? Or, do they attempt to reach the people, like me, to no avail?

All of these situations are problematic and not what you would want in your business. In business, it is important that people are paying attention and notice when things go sideways. They are engaged in the business and care. They do notice and raise the flag to get issues corrected. And when the red flag goes up, there is a mechanism such that it is easy to resolve and the person is recognized for doing the right thing. Do you have a company culture where people are engaged and it is easy to get things done? Or is it hard to resolve situations and people just don’t care? How are you creating the culture you want in your company?

What are your red flags?

what are your red flags?It has been raining pretty significantly for days. I didn’t notice it at first because it was dark and due to the amount of runoff in the hilly areas heading to the storm drains. After days of walking by, something didn’t seem right, so I took a closer look. And there it was – probably a broken pipe at the sprinkler irrigation box with significant quantities of water literally heading down the drain. The house was on the corner – it’s front door and driveway on one street and the leak on the other. It’s a house I walk past daily and is a few miles from home, so I don’t know the people. After knocking on their door and three others, I finally found someone home to alert. It’s likely the people are out of town. A few more days passed and a few calls to the water department, the issue was addressed. But the water keeps flowing. They will be facing a massive water bill and huge amounts of wasted water. Clearly there was no mechanism to alert the city or the people to the problem.

Many businesses face similar issues around leakage. They may arise in areas with low visibility. Without a mechanism to alert you to the issue, it can go unchecked for quite some time, resulting in a big surprise. Other times, it may be noticed, but unresolved because the people don’t have an avenue to resolve it. The challenge is to keep ahead of it and address the root cause before it becomes significant. Do you have warning systems in place that alert you to issues in your business? And if you do, do the people have a mechanism to resolve the issue before it becomes significant?

What are you thankful for?

what are you thankful forIt is almost Thanksgiving – a time to reflect on what we are thankful for. For me, the list is long. So, I’ll pick two to share.

In 1989 I had the opportunity to visit many of the Eastern Block countries for a month. We went through Checkpoint Charlie – the crossing point between East and West Berlin. I was amazed at the stark difference in everything. The trip went through East Germany, Hungary, Czechoslovakia, Poland, Ukraine (USSR at the time), and Austria. People shared that there were 10-year waiting lists to get a car (and it was used), food wasn’t always readily available, military/police/cameras were everywhere, and people didn’t have much (housing, clothing, opportunities). A trip to Cuba (legally) in 2013 had many similarities. One of the interesting points made was that the ability to speak freely was only a few years old (and people questioned how much they could discuss openly). I didn’t appreciate what we have in the United States until I saw what others didn’t. I’m lucky and thankful to be living here.

In 2014, I was on an amazing trip to Turkey. Part way through, I got sick. After thinking I had food poisoning, it was soon clear that was not the case. Something was wrong, but I didn’t know what. At that point, we were on a boat off the coast near small towns. Even though I didn’t feel well, I sucked it up and kept going. Three weeks later after the trip ended and many tests to figure out what was wrong, I was told my appendix had burst and would be in the hospital for a few days. Friends stepped up to pick up my dog from the groomer, take care of her, get my underwear from home, etc. I’m thankful for good friends and for being alive.

Gratitude in all aspects of life is important. What are you thankful for? Have you made a practice of thinking about what you are thankful for everyday and sharing it with others?

 

The Definition of Insanity

Definition of insanityIt happens about this time every year. Companies go through an annual planning process. People painstakingly put together their expense budgets. Cost of living and general inflation is factored in. All the numbers get pulled together and the expenses are too high. So, a note goes out that instructs people to cut expenses. Not do things differently. Just cut expenses. In some cases, a reorg is announced and people shuffle seats, sometimes accompanied by headcount reductions. In either of these cases, the people are expected to do the same thing with less. It happens every year. That’s the definition of insanity – doing things the same way and expecting a different result.

The world continues to evolve. To stay effective and competitive, the business needs to evolve as well. Rather than going through and looking at the expenses and revenues in isolation, a better approach is to look at how the business can operate most effectively. This includes how technology is used, whether processes are efficient and effective, and whether the needs of the customer are being met. The financial results are a symptom of how well the organization is working. How do you make sure you aren’t in the insanity trap?

Is the solution right in front of you?

the solution is right in front of youYou know those embarrassing moments when the solution is so obvious, but you have somehow overlooked it? I had one of those moments recently. My dog decided it would be entertaining to shred both ends of a bag of potting soil and spread some of the soil around the garage. It was a brand new bag. And with both ends opened, I needed to figure out what to do with it. While it was not a priority, it would annoy me every time I looked at it. There it sat for several weeks, until I looked six or so feet past the bag to a pile of empty tubs. All I had to do was carefully pick up the bag and dump it into the tub. It was an obvious solution. And it had been there the whole time.

Many times the solution to the issue you are working in business is already there. It may be the experience of a person somewhere else in the company, or it may be right there staring you in the face waiting for you to look up. The solution presents itself when you declare the issue and are open to the solution. By doing this, it opens the conversation for the people with the knowledge to come forward. Or it shifts your focus to resolving the issue. How are you making sure you don’t miss the solutions that are right in front of you?

Are you squirreling away nuts for a rainy day?

saving nuts for a rainy dayThe squirrels have been out in force lately pulling acorns down from the trees. They seem busier this year than in past years. And if you believe the news, it is supposed to be colder and wetter in the Northwest than in past years. It makes sense that the instinct is to stock up on an appropriate level of supplies to get through the winter. As these are grey squirrels, they actually remember where they buried their nuts (according to “Grey Squirrels Remember the Locations of Buried Nuts,” published in Princeton University’s journal “Animal Behavior”) and will be able to find them when they need them.

An area that is not always thought through adequately in business is the rainy day fund, the availability of cash when you need it. Depending on the type of business you are in, the seasonal and cyclical nature of the market will cause swings in cash flowing through your business. It is important to understand how deep and wide the downtimes can be. This allows you to know how to minimize cash outflow when times are bad. It also tells you how much cash you need to have available and for how long. When thinking through this, all sources of cash should be considered, including credit lines and the ability to reduce working capital. By going through the exercise ahead of time, you will know if your sources of cash are adequate or not. If not, you have the ability to secure those sources before you need them. How are you making sure you are prepared for a rainy day?